M/S. AVON DEALCOM PVT. LTD.,KOLKATA vs. ITO, WARD - 11(4), KOLKATA

This appeal filed by the assessee pertaining to the Assessment Year (in short “AY”) 2012-13 is directed against the order passed u/s 250 of the Income Tax Act, 1961 (in short the “Act”) by ld. Commissioner of Income-tax (Appeals)-15, Kolkata [in short ld. “CIT(A)”] dated 14.11.2018 which is arising out of the assessment order framed u/s 143(3) of the Act dated 13.03.2015.

For that on the facts and circumstances of the case, the Ld. A.O. With a pre biased mind on a stereotype basis, simply added the share capital increased of Rs 5,28,00,000/-, without making any proper enquiry & investigation from the parties & the concerned Directors of the Companies involved when such details were submitted before the Ld. A.O to prove the genuinity of the share capital introduced.

Without prejudice to above, for that on the facts and circumstances of the case, the Ld. CIT (Appeals) grossly erred in confirming the addition made by the Ld. A.O. of Rs 5,28,00,000/- without giving proper and meaningful opportunity of being heard to the appellant which is in gross violation of the principles of natural justice and hence illegal, arbitrary and highly unjustified.

For that on the facts and circumstances of the case, the Ld. CIT(Appeals) was vehemently wrong and unjustified in not considering the facts of the case and the submission made by the I.T.A. No.: 1770/Kol/2019 Assessment Year: 2012-13 M/s Avon Dealcom Pvt. Ltd

We have heard the ld. DR and perused the records placed before us. We observe that the impugned order is ex parte. We also notice that the assessee which is a private limited company declared nil income in the return filed for assessment year 2012- 13 on 22.03.2013. After the case was selected for scrutiny by I.T.A. No.: 1770/Kol/2019 Assessment Year: 2012-13 M/s Avon Dealcom Pvt. Ltd service of notices u/s 143(2) and 142(1) of the Act, the Assessing Officer examined various transactions carried out by the assessee company during the year including the receipt of share capital of Rs.10,56,000/- and share premium of Rs.5,17,44,000/- totalling to Rs.5,28,00,000/-. The ld. Assessing Officer was not satisfied with the submissions made by the assessee and doubted the genuineness of these transactions looking to the very little visible activity carried out by the assessee company and huge amount of share premium charged on the share issue during the year and thus the source of the said capital and share premium remained unexplained. Ld. Assessing Officer assessed the income at Rs.5,28,00,000/- after making an addition u/s 68 of the Act at Rs.5,28,00,000/-.

Aggrieved, assessee preferred appeal before the ld. CIT(A) but failed to appear on various dates of hearing which led the ld. CIT(A) to frame the order ex parte in confirming the addition made by the Assessing Officer.

Before us, an affidavit has been filed by Mr. Virendra Singh, Director of the M/s Avon Dealcom Pvt. Ltd., praying for one more opportunity to be granted to appear before ld. CIT(A). the ld. Departmental Representative being fair enough not to oppose this request. We, therefore, in the interest of justice and being fair to both the parties, set aside the finding of the ld. CIT(A) and restore all the issues on merits for afresh adjudication to Ld. CIT(A) which shall be carried out after providing assessee with the I.T.A. No.: 1770/Kol/2019 Assessment Year: 2012-13 M/s Avon Dealcom Pvt. Ltd reasonable and meaningful opportunity. We also direct the assessee company to remain vigilant to the notice of hearing issued by ld. CIT(A) and should not take adjournment unless and otherwise required for reasonable cause and may file all the necessary documents and submissions in support of its grounds of appeal.

In the result, the appeal filed by the assessee is allowed for statistical purposes.